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NEWS : STORIES
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06.15.2005 8:31 AM EDT
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Def Jam/ TVT Battle Over Ja Rule Picks Up After Reversal
Court rules Def Jam doesn't have to pay TVT $53 million.
by
Gil Kaufman
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Ja Rule (file)
(Photo:
Def Jam
)
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The fight over who should benefit from discovering Ja Rule continues. In the latest twist, a U.S. appellate court on Tuesday reversed a federal judge's ruling that ordered the Island Def Jam Group and former chairman Lyor Cohen to pay independent
label TVT Records a record $53 million in damages for backing out of a deal to let TVT release a record by Rule's early group, the Cash Money Click. The judge reduced the damages to $126,000.
The U.S. Second Circuit Court of Appeals in Manhattan found there was insufficient evidence to support TVT's claims that Def Jam and Cohen were liable for blocking the release of the Rule album, according to a report in the Los Angeles Times. The ruling negated one of the biggest damage awards in music-business history, which was originally pegged at $132 million, but reduced in late 2003 to $53 million.
At the time, even with the damage award halved, TVT attorney Peter Haviland predicted that the verdict looked "pretty bulletproof on appeal." Though the massive judgment was struck down, TVT will receive $126,720 in compensatory damages on a breach-of-contract claim that Def Jam did not appeal.
The reversal was also a weight off Cohen's shoulders, as he would have been personally liable for $3 million of the $53 million judgment. But he shouldn't start spending that cash just yet, as Haviland released a statement on Tuesday saying that TVT will appeal the reduced damages judgment.
"We were forced to bring this action in part because Mr. Cohen and Def Jam denied the existence of a contract critical to our business. This court has affirmed that we did have a contract and that the defendants broke it. This is not over, and we look forward to the next round," Haviland said in the statement.
The appeals court ruling did not dispute that TVT discovered Ja Rule in the early '90s, when he was part of the Cash Money Click. The Click recorded a number of songs for the label, which did not release an album by the group (see "Def Jam, Lyor Cohen Guilty Of Fraud; Ja Rule Fights Patrick 'Dirty Dancing' Swayze"). Rule left TVT and became a solo superstar after signing with Def Jam in 1998.
TVT president Steve Gottlieb approached Cohen in 2001 about the labels collaborating on a Cash Money Click reunion album. According to the suit, Cohen encouraged the reunion album idea in an effort to appease Rule, who wanted to help out his former bandmates.
After Gottlieb reportedly spent $1 million producing and promoting the album, TVT alleged that Cohen convinced Rule to drop the project and then withdrew permission to let him participate, leading to the original suit in 2002 alleging breach of contract.
This report is provided by MTV News
 
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